An Open Letter to the Board and Mayor

Next Tuesday the Board of Supervisors will go into Executive Session to consider amending the city’s Public Finance program in view of a U.S. Supreme Court decision earlier this year that found Arizona’s full public finance program to have constitutional problems.

San Francisco’s partial public finance program is rumored to be threatened with an expensive lawsuit although no lawsuit has been filed nor has any group announced that it will definitely file a lawsuit.

But based on rumors and threats without a single dollar being spent to overturn San Francisco’ s system, and at the urging of a Board of Supervisor member who benefited from outside spending in excess of $200,000 last November, the city is preparing to enact changes to allow unlimited spending by deep pocket outside interests intent on tilting the November election in their favor. The current system that allows public funding to rebalance the tilt toward special interest money would be ended.

The fact that this stampede takes place after the rules have been set for this election, after the candidates have operated under those rules for more than a year, and with weeks left until voters decide on a new mayor, is no accident. Nor is the fact of a U.S. Supreme Court decision that touches on aspects of San Francisco’s law sufficient reason to rush to do the bidding of political operatives who have a stake in ensuring that the result benefits their clients.

They hope that the Board of Supervisors will pay no heed to the consequences for San Franciscans, and instead dress their self-interest in the robes of a constitutional crisis.

Whether the Board will defeat the effort to interrupt San Francisco’s election rules in the final weeks of an election remains to be seen. It will require four supervisors to decline to vote for their change to postpone action, with it unlikely that the special interests will be able to win the changes they seek through other means before the November election.

That alone is reason to pause and take a more thoughtful and open process toward resolving the issue of San Francisco’s public financing system following the U.S. Supreme Court ruling.

Yet there are other choices beside an up or down vote on this proposal.

The Board could squarely face the consequences of such an action in mid-election and take other steps to lessen the impact of special interest money in the November election.

CitiReport urges the Board to immediately enact provisions to force into the open the flow of special interest money in this election and to rein in the pay-to-play politics that is coming to dominate City Hall.

1.) San Francisco’s law banning political contributions from those seeking a city contract should be immediately amended to also ban contractors and those seeking contracts from soliciting contributions from others, being an intermediary for contributions, or bundling contributions. Amazingly, San Francisco allows contractors to arrange fundraisers and collect money so long as they themselves do not write a check. Federal law prohibits this pay-to-play tactic but San Francisco does not.

2.) San Francisco’s law banning political contributions from contractors and those seeking contracts should immediately be amended to include those who seek City Hall action that benefits them financially, including development agreements, variances for their specific project, tax benefits unique to them, permits, grants and other city approvals that enrich them. San Franciscans already voted to ban such sources of contributions when voters passed Proposition J in 2000, but a later Board action rewrote the rules to open loopholes in the law. The loopholes should be closed now.

3.) San Francisco’s disclosure laws should require disclosure of the names of those who serve on a candidate or ballot measure’s finance committee or who are designated as fundraisers. Currently the public gets only a glimpse of who the heavy hitters are holding fundraisers or serving as intermediaries and soliciting contributions when an event makes the society pages. Mayor Lee was asked repeatedly during his interview whether he would release the names of those on his finance committee during his interview with the San Francisco Examiner. He replied that he would do what the law requires. The law should require him and all other candidates to publicly disclose these finance members and file immediate amendments when a new person is added.

4.) San Francisco’s disclosure laws should immediately be amended to close the loophole that allows hundreds of thousands of dollars in last minute contributions to remain hidden from the public before the election. San Francisco uses the state rule of disclosures of contributions of $1,000 or more within 24 hours during the final critical period before an election. At the same time, San Francisco sets the contribution limits for candidates at $500.00 The result is that in San Francisco there is no reporting of these contributions, which in past elections have totaled between one-third and one-half of all contributions, until months after the election is over. The law should be amended to require immediate disclosure during this period of all contributors who make or aggregate $250 to a candidate.

5.) San Francisco’s disclosure laws should be immediately amended to end the “reporting holiday” that keeps the public from having information on contributors and spending by those designated as “state committees” or independent expenditure committees who are involved in San Francisco elections. Under state reporting rules, these committees only file during even number years, but San Francisco’s mayor’s election is in an odd numbered year. These committees don’t report their activity until more than a year after the election. That should end at once. The California Fair Political Practices Commission wrote to the San Francisco Ethics Commission that the city has the authority to enact this requirement, but the Ethics Commission has declined to act.

6.) San Francisco’s Board should immediately direct the Ethics Commission to make it a priority to enforce the current law prohibiting officers and executives of businesses and nonprofits who receive city funding, either in grants or contracts, from making contributions to candidates who decide on their grants or contracts. The Ethics Commission has never enforced this law and even sought to amend it so that it no longer applies for some. There can be no excuse for failure to enforce a law that protects the public from pay-to-play politics. CitiReport gave readers an extensive review of violations of this law, and the Ethics Commission continued not to act.

These six immediate action items will not compensate for a rush to end the important provisions of San Francisco’s public finance system in the closing weeks of the election, but they can add some protections against pay-to-play politics that are the heart of special interest politics.

They should be passed as urgency measures to go into effect at once.

Earlier CitiReport asked mayoral candidates whether they supported a number of these proposals, and in nearly every case, candidates responded favorably.

City Attorney Dennis Herrera noted that he voted in favor of Proposition J in 2000 and would work on reforms now.

Board President Chiu stated he would be open to supporting a measure that would ban contributions from a business that benefits financially from a city decision so long as that decision was specific to that business.

Supervisor Avalos stated he would be willing to introduce such a measure.

Public Defender Jeff Adachi wrote that he “would certainly support this.”

State Senator Leland Yee wrote he would be willing to introduce it, noting “Clearly, the voters approved and agreed with Proposition J and San Francisco should adhere to the spirit, intent and letter of the law.”

Former Supervisor Tony Hall responded that he would introduce such a measure. Former Supervisor Bevan Dufty reasserted his view that City Hall decisions should not be influenced.

CitiReport also asked mayoral candidates whether they felt the Ethics Commission was succeeding in its mission. Not a single candidate stated that they are satisfied with its performance, and most called for stronger action, ranging from fuller funding to serious enforcement of San Francisco’s ethics laws.

That is an important factor in adopting these urgent actions, and as the Board also takes up the Civil Grand Jury report on the Ethics Commission as a “Sleeping Watchdog,” the Board should make clear that it will not accept token improvements in a broken system but is looking for leadership and action, which has not been evident to date.

San Francisco’s mayor’s election has serious consequences for the city’s future. It is clear from the rush to overturn our existing laws that rebalance the influence of special interest money that the deep pocket interests are worried that they will have to engage City Hall on an even playing field rather than one they control.

That is the one overriding issue before the Board as it deliberates on a plan to change our city’s public finance law.